Expect a comeback for some department stores, former Saks CEO says

Sadove: Consumers pretty healthy

Things are going to start looking up for certain department stores, former Saks CEO Steve Sadove told CNBC on Friday.

The news has been grim for department stores of late, with the group suffering a 0.7 percent sales decline in September. In May, it reported its worst results since the recession.

While the retailers still have some fundamental issues to solve, expected changes in the weather should bode well for them, Sadove said in an interview with "Power Lunch."

"You're probably going to have one of the biggest swings of warm weather to cold weather in November, December, and that's going to be good for anything that is apparel- and cold-weather based. So the department stores should fare well in that environment."

On top of that, the consumer is healthy and the holiday shopping season should be good, he noted.

The National Retail Federation expects sales in November and December, excluding autos, gas and restaurant sales, to increase 3.6 percent. That's significantly higher than the 10-year average of 2.5 percent and above the seven-year average of 3.4 percent since the recovery began in 2009, the organization reported.

That said, there will be winners and losers in the department store space, Sadove said.

"The consumer wants buy now, wear now. The consumer is fickle. The consumer is thinking differently."

He believes those who will come out on top will be omni-channel retailers, which means they use a variety of channels such as brick-and-mortar shops and online stores to reach customers.

"You've got to be able to be able to buy anywhere, anytime you want to be able to do. You've got to have differentiated product. You've got to have an experience that the customer wants. Those retailers that are doing it are going to win," he said.

— The Associated Press contributed to this report.

Related Tags